Insurance should compensate you for all of your ‘loss’

Q. My family was involved in a car accident. My brother was driving and my 80 year-old grandmother was also in the vehicle, along with my mother. It was the other driver’s fault. We are attempting to settle, but the insurance company only wants to pay for medical bills and damage to our car, even though we went through a lot of stress and other financial loss. What can I do to have them compensate us?

A. When someone causes an accident, they are responsible under an area of law known as tort law. The objective of tort law is to place you back in the position you were before the accident. This means compensating you for whatever loss you incurred as a result of the accident. Basically, there are two types of damages: economic and non-economic.

Economic damages include all of your financial loss, such as the value of the car and medical bills. It sounds like the insurance company is offering to compensate you for this loss. You say you have “other financial loss,” and you should let them know you expect to be compensated for that loss. For example, you may have had some other personal property in the car that was damaged, or lost wages. Most insurance companies will compensate you for this type of loss once you give them proof of the amount.

The law also allows you to recover non-economic loss, such as pain and suffering and mental anguish. In my opinion, however, recovering for your “stress” may be very difficult in Texas. You generally need an extreme situation. You cannot recover for “mere anxiety, worry, vexation, embarrassment or anger.” For example, mental anguish is recoverable when you are receiving psychiatric care. To recover for mental anguish, you usually must show that the stress caused a “substantial disruption in your daily routine.” If the insurance company refuses to offer compensation for your stress and you feel you are entitled to it, you will need to speak with a personal injury attorney to assist you. Be sure to ask what it will cost before signing anything. You may end up with less money than you have been offered.


Q. My husband and I have been married for over 30 years. I am currently unemployed. Our marriage is going down hill and I am afraid he will file for divorce. Is there a law requiring he pay me alimony.

A. At the time of your divorce, the court will divide the community property you have acquired during the marriage. Texas does not authorize alimony, but it does allow a court to order spousal support if you cannot support yourself on the property you have after the divorce. Because you have been married for more than 10 years, you are eligible for spousal support. Generally, it is awarded for a period of three or fewer years. I suggest you promptly speak with a family law attorney as soon as you believe your husband may file.


Q. Can I be sued or put in jail for a payday loan I defaulted on in 2008? A debt collector is threatening to sue and put me in jail.

A. First, you cannot be put in jail for not paying your debts. We ended debtor’s prison a long time ago. You can be sued for defaulting on a payday loan, but the statute of limitations says when a lawsuit must be filed in four years. This means that if the lender sued, you would have a defense to the lawsuit.

There also is a very strong federal debt collection statute that prohibits wrongful threats and misleading statements. Look at my website for much more information about the Fair Debt Collection Practices Act. Threatening to sue on an old debt or to put a consumer in jail violates this law. The law lets you recover any actual damages you have, plus a penalty of up to $1,000. My guess is that letting the collector know that you know about this law will end the threats, and allow you to work out a payment plan you can live with, or stop all further collection efforts.